Bucharest, 21 March 2022 - More than 50,000 Romanians benefited from the amounts accumulated in the Pillar II private pension account between 2016 and 2021, according to data centralized by the Financial Supervisory Authority. Most of them are either relatives of contributors who have died or contributors who retired due to illness. The total amount paid out by administrators during this period amounts to almost 660 million lei, and the number of beneficiaries has increased from just 675 in 2016 to 19,000 in 2021.
The private pension system has proven to be robust enough to weather periods of crisis. In the 14 years or so since the scheme was set up, the value of net unit assets has risen from 10 lei to over 28.5 lei. In other words, pension funds have brought a 185% gain to contributors. The fact that 50,000 Romanians have already benefited from pension payments, with returns ranging from 100% to 185%, is a further argument for the soundness and usefulness of the system.
The average amount received in 2018, the first year in which the number of payments was considerable, was less than 7,500 lei, reaching 13,200 lei in 2021, according to data available on the website of the A.S.F., in annual reports on the private pension market.
According to the latest report, during the last year the private pension market continued to grow, despite the volatility induced by the COVID-19 crisis.
Total net assets of privately managed pension funds were RON 89.07 billion at the end of December 2021, up by about 19% compared to the same period in 2020. Compared to the previous quarter, net assets increased by 2%. The number of registered participants in the privately administered pension system as at 31 December 2021 was 7.79 million, up from 7.63 million as at 31 December 2020.
At Pillar II level, the average contribution of participants with contributions paid on 31 December 2021 was about 204 lei/participant, while on 31 December 2020 it was 192 lei/participant. In the period from January to December 2021, contributions paid into the privately managed pension system amounted to RON 9.77 billion, an increase of about 10% compared to 2020. The weighted average rate of return of all privately managed pension funds was 5.79% in December 2021, in December 2020 its value was 5.38%. At the end of December 2021, the average asset value of a participant in the privately managed pension system was 11,434 lei, an increase of 16% compared to December 2020 and 1.5% compared to the previous quarter. In the period January - December 2021, payments of net personal assets to participants were made in the amount of 288 million lei for approximately 19 thousand participants and beneficiaries.
You can find more details on the development of the private pension market in 2021 here.
On www.edutime.ro you can find everything you need to know about private pensions.